Political Determinants of Fossil Fuel Pricing

This paper provides an empirical analysis of economic and political determinants of gasoline and diesel prices for about 200 countries over the period 1991-2010. A range of both political and economic variables are found to systematically influence...

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Main Authors:	van Beers, Cees, Strand, Jon
Format:	Policy Research Working Paper
Language:	English en_US
Published:	World Bank, Washington, DC 2013
Subjects:	ACCESS TO ENERGY AVAILABILITY BARRIER BENCHMARK CAR CAR OWNERS CAR OWNERSHIP CARBON EMISSIONS CARS CLIMATE CHANGE COMMODITIES COMPETITIVENESS CONSUMERS CONSUMPTION LEVELS COST OF ENERGY COUNTRY FIXED EFFECT CRUDE OIL CRUDE OIL PRICE DEBT DEMAND FOR GASOLINE DEMOCRACIES DEMOCRACY DEMOCRATIC SOCIETIES DEVELOPING COUNTRIES DEVELOPMENT POLICY DEVELOPMENT PROJECTS DIESEL DIESEL USE DOMESTIC ENERGY DOMESTIC MARKET ECONOMIC DEVELOPMENT ECONOMIC SYSTEMS ECONOMIES OF SCALE ELECTRICITY EMPLOYMENT ENERGY CONSUMPTION ENERGY COSTS ENERGY EXPORTS ENERGY PRICES ENERGY PRICING ENERGY PRODUCTION ENERGY SUPPLY ENERGY USE EXPORT MARKETS EXPORTS EXTERNALITIES EXTERNALITY FOSSIL FOSSIL ENERGY FOSSIL FUEL FOSSIL FUEL CONSUMPTION FOSSIL FUEL ENDOWMENTS FOSSIL FUEL ENERGY FOSSIL FUEL PRICES FOSSIL FUEL USE FOSSIL FUELS FUEL CONSUMPTION FUEL PRICE FUEL PRICES FUEL PRODUCERS FUEL PUMP FUEL SUBSIDIES FUEL TAX FUEL TAX RATES FUEL TAXATION FUEL TAXES FUEL VOLUME GAS CONSUMPTION GAS PRICES GASOLINE GASOLINE CONSUMPTION GASOLINE PRICES GDP GDP PER CAPITA GLOBAL CLIMATE GLOBAL CLIMATE CHANGE GOVERNANCE INDICATORS GOVERNMENT BUDGET GOVERNMENT EXPENDITURES GRID CONNECTIONS GROSS DOMESTIC PRODUCT GROSS DOMESTIC PRODUCT PER CAPITA INCOME INCOME GROUP INCOME GROUPS INCOME LEVELS KEROSENE KEROSENE SUBSIDIES LESS DEVELOPED COUNTRIES LOW-INCOME COUNTRIES MARKET PRICE MIDDLE INCOME COUNTRIES MIDDLE-INCOME COUNTRIES MONOPOLIES MOTOR FUEL MOTOR FUELS MOTOR VEHICLE MOTOR VEHICLE TRAFFIC MOTOR VEHICLE USE MOTOR VEHICLES NATURAL GAS NEGATIVE EXTERNALITIES NET OIL OIL EXPORTER OIL EXPORTERS OIL IMPORTING COUNTRIES OIL OUTPUT OIL PRICES OIL SUPPLY OPPORTUNITY COSTS PASSENGER CARS POLITICAL BUSINESS CYCLE POLITICAL DETERMINANTS POLITICAL ECONOMY POLITICAL POWER POLITICAL REGIME POLITICAL STABILITY POLITICAL SYSTEM POLLUTION POLLUTION LEVELS POSITIVE EFFECTS POVERTY ALLEVIATION POWER POWER DISTRIBUTION POWER PARITY PRICE CHANGES PRICE DISTORTIONS PRICE INCREASES PRICE LEVELS PRIVATE TRANSPORT PROPORTIONAL REPRESENTATION PUBLIC FINANCES PUBLIC GOOD PURCHASING POWER REGIME CHANGE REGULAR GASOLINE RESTRICTIONS ROAD ROAD TRAFFIC ROAD TRANSPORT ROADS SAFETY TAX TAX REVENUE TAX REVENUES TRANSPORTATION TRAVEL DISTANCES TRUE UTILITIES VEHICLES VOTERS WEALTH WORLD MARKET
Online Access:	http://documents.worldbank.org/curated/en/2013/05/17784262/political-determinants-fossil-fuel-pricing http://hdl.handle.net/10986/15569

id	okr-10986-15569
recordtype	oai_dc
spelling	okr-10986-155692021-04-23T14:03:19Z Political Determinants of Fossil Fuel Pricing van Beers, Cees Strand, Jon ACCESS TO ENERGY AVAILABILITY BARRIER BENCHMARK CAR CAR OWNERS CAR OWNERSHIP CARBON EMISSIONS CARS CLIMATE CHANGE COMMODITIES COMPETITIVENESS CONSUMERS CONSUMPTION LEVELS COST OF ENERGY COUNTRY FIXED EFFECT CRUDE OIL CRUDE OIL PRICE DEBT DEMAND FOR GASOLINE DEMOCRACIES DEMOCRACY DEMOCRATIC SOCIETIES DEVELOPING COUNTRIES DEVELOPMENT POLICY DEVELOPMENT PROJECTS DIESEL DIESEL USE DOMESTIC ENERGY DOMESTIC MARKET ECONOMIC DEVELOPMENT ECONOMIC SYSTEMS ECONOMIES OF SCALE ELECTRICITY EMPLOYMENT ENERGY CONSUMPTION ENERGY COSTS ENERGY EXPORTS ENERGY PRICES ENERGY PRICING ENERGY PRODUCTION ENERGY SUPPLY ENERGY USE EXPORT MARKETS EXPORTS EXTERNALITIES EXTERNALITY FOSSIL FOSSIL ENERGY FOSSIL FUEL FOSSIL FUEL CONSUMPTION FOSSIL FUEL ENDOWMENTS FOSSIL FUEL ENERGY FOSSIL FUEL PRICES FOSSIL FUEL USE FOSSIL FUELS FUEL CONSUMPTION FUEL PRICE FUEL PRICES FUEL PRODUCERS FUEL PUMP FUEL SUBSIDIES FUEL TAX FUEL TAX RATES FUEL TAXATION FUEL TAXES FUEL VOLUME GAS CONSUMPTION GAS PRICES GASOLINE GASOLINE CONSUMPTION GASOLINE PRICES GDP GDP PER CAPITA GLOBAL CLIMATE GLOBAL CLIMATE CHANGE GOVERNANCE INDICATORS GOVERNMENT BUDGET GOVERNMENT EXPENDITURES GRID CONNECTIONS GROSS DOMESTIC PRODUCT GROSS DOMESTIC PRODUCT PER CAPITA INCOME INCOME GROUP INCOME GROUPS INCOME LEVELS KEROSENE KEROSENE SUBSIDIES LESS DEVELOPED COUNTRIES LOW-INCOME COUNTRIES MARKET PRICE MIDDLE INCOME COUNTRIES MIDDLE-INCOME COUNTRIES MONOPOLIES MOTOR FUEL MOTOR FUELS MOTOR VEHICLE MOTOR VEHICLE TRAFFIC MOTOR VEHICLE USE MOTOR VEHICLES NATURAL GAS NEGATIVE EXTERNALITIES NET OIL OIL EXPORTER OIL EXPORTERS OIL IMPORTING COUNTRIES OIL OUTPUT OIL PRICES OIL SUPPLY OPPORTUNITY COSTS PASSENGER CARS POLITICAL BUSINESS CYCLE POLITICAL DETERMINANTS POLITICAL ECONOMY POLITICAL POWER POLITICAL REGIME POLITICAL STABILITY POLITICAL SYSTEM POLLUTION POLLUTION LEVELS POSITIVE EFFECTS POVERTY ALLEVIATION POWER POWER DISTRIBUTION POWER PARITY PRICE CHANGES PRICE DISTORTIONS PRICE INCREASES PRICE LEVELS PRIVATE TRANSPORT PROPORTIONAL REPRESENTATION PUBLIC FINANCES PUBLIC GOOD PURCHASING POWER REGIME CHANGE REGULAR GASOLINE RESTRICTIONS ROAD ROAD TRAFFIC ROAD TRANSPORT ROADS SAFETY TAX TAX REVENUE TAX REVENUES TRANSPORTATION TRAVEL DISTANCES TRUE UTILITIES VEHICLES VOTERS WEALTH WORLD MARKET This paper provides an empirical analysis of economic and political determinants of gasoline and diesel prices for about 200 countries over the period 1991-2010. A range of both political and economic variables are found to systematically influence fuel prices, and in ways that differ systematically with countries per-capita income levels. For democracies, the analysis finds that fuel prices correlate positively with both duration of democracy and tenure of democratic leaders. In non-democratic societies there is more often no such relationship or it is the opposite of that for democracies. Regime switches -- transitions from non-democratic to democratic government, or vice versa -- reduce fuel prices. Fuel prices are also lower for more corrupt, or more centralized, governments. Higher levels of gross domestic product per capita lead to higher fuel prices, while export income from selling fossil fuels reduces these prices dramatically. Higher motor fuel consumption also appears to reduce fuel prices, most for gasoline. Absolute "pass-through" of crude oil price changes to fuel prices is found to be high on average. 2013-09-04T15:57:54Z 2013-09-04T15:57:54Z 2013-05 http://documents.worldbank.org/curated/en/2013/05/17784262/political-determinants-fossil-fuel-pricing http://hdl.handle.net/10986/15569 English en_US Policy Research Working Paper;No. 6470 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English en_US
topic	ACCESS TO ENERGY AVAILABILITY BARRIER BENCHMARK CAR CAR OWNERS CAR OWNERSHIP CARBON EMISSIONS CARS CLIMATE CHANGE COMMODITIES COMPETITIVENESS CONSUMERS CONSUMPTION LEVELS COST OF ENERGY COUNTRY FIXED EFFECT CRUDE OIL CRUDE OIL PRICE DEBT DEMAND FOR GASOLINE DEMOCRACIES DEMOCRACY DEMOCRATIC SOCIETIES DEVELOPING COUNTRIES DEVELOPMENT POLICY DEVELOPMENT PROJECTS DIESEL DIESEL USE DOMESTIC ENERGY DOMESTIC MARKET ECONOMIC DEVELOPMENT ECONOMIC SYSTEMS ECONOMIES OF SCALE ELECTRICITY EMPLOYMENT ENERGY CONSUMPTION ENERGY COSTS ENERGY EXPORTS ENERGY PRICES ENERGY PRICING ENERGY PRODUCTION ENERGY SUPPLY ENERGY USE EXPORT MARKETS EXPORTS EXTERNALITIES EXTERNALITY FOSSIL FOSSIL ENERGY FOSSIL FUEL FOSSIL FUEL CONSUMPTION FOSSIL FUEL ENDOWMENTS FOSSIL FUEL ENERGY FOSSIL FUEL PRICES FOSSIL FUEL USE FOSSIL FUELS FUEL CONSUMPTION FUEL PRICE FUEL PRICES FUEL PRODUCERS FUEL PUMP FUEL SUBSIDIES FUEL TAX FUEL TAX RATES FUEL TAXATION FUEL TAXES FUEL VOLUME GAS CONSUMPTION GAS PRICES GASOLINE GASOLINE CONSUMPTION GASOLINE PRICES GDP GDP PER CAPITA GLOBAL CLIMATE GLOBAL CLIMATE CHANGE GOVERNANCE INDICATORS GOVERNMENT BUDGET GOVERNMENT EXPENDITURES GRID CONNECTIONS GROSS DOMESTIC PRODUCT GROSS DOMESTIC PRODUCT PER CAPITA INCOME INCOME GROUP INCOME GROUPS INCOME LEVELS KEROSENE KEROSENE SUBSIDIES LESS DEVELOPED COUNTRIES LOW-INCOME COUNTRIES MARKET PRICE MIDDLE INCOME COUNTRIES MIDDLE-INCOME COUNTRIES MONOPOLIES MOTOR FUEL MOTOR FUELS MOTOR VEHICLE MOTOR VEHICLE TRAFFIC MOTOR VEHICLE USE MOTOR VEHICLES NATURAL GAS NEGATIVE EXTERNALITIES NET OIL OIL EXPORTER OIL EXPORTERS OIL IMPORTING COUNTRIES OIL OUTPUT OIL PRICES OIL SUPPLY OPPORTUNITY COSTS PASSENGER CARS POLITICAL BUSINESS CYCLE POLITICAL DETERMINANTS POLITICAL ECONOMY POLITICAL POWER POLITICAL REGIME POLITICAL STABILITY POLITICAL SYSTEM POLLUTION POLLUTION LEVELS POSITIVE EFFECTS POVERTY ALLEVIATION POWER POWER DISTRIBUTION POWER PARITY PRICE CHANGES PRICE DISTORTIONS PRICE INCREASES PRICE LEVELS PRIVATE TRANSPORT PROPORTIONAL REPRESENTATION PUBLIC FINANCES PUBLIC GOOD PURCHASING POWER REGIME CHANGE REGULAR GASOLINE RESTRICTIONS ROAD ROAD TRAFFIC ROAD TRANSPORT ROADS SAFETY TAX TAX REVENUE TAX REVENUES TRANSPORTATION TRAVEL DISTANCES TRUE UTILITIES VEHICLES VOTERS WEALTH WORLD MARKET
spellingShingle	ACCESS TO ENERGY AVAILABILITY BARRIER BENCHMARK CAR CAR OWNERS CAR OWNERSHIP CARBON EMISSIONS CARS CLIMATE CHANGE COMMODITIES COMPETITIVENESS CONSUMERS CONSUMPTION LEVELS COST OF ENERGY COUNTRY FIXED EFFECT CRUDE OIL CRUDE OIL PRICE DEBT DEMAND FOR GASOLINE DEMOCRACIES DEMOCRACY DEMOCRATIC SOCIETIES DEVELOPING COUNTRIES DEVELOPMENT POLICY DEVELOPMENT PROJECTS DIESEL DIESEL USE DOMESTIC ENERGY DOMESTIC MARKET ECONOMIC DEVELOPMENT ECONOMIC SYSTEMS ECONOMIES OF SCALE ELECTRICITY EMPLOYMENT ENERGY CONSUMPTION ENERGY COSTS ENERGY EXPORTS ENERGY PRICES ENERGY PRICING ENERGY PRODUCTION ENERGY SUPPLY ENERGY USE EXPORT MARKETS EXPORTS EXTERNALITIES EXTERNALITY FOSSIL FOSSIL ENERGY FOSSIL FUEL FOSSIL FUEL CONSUMPTION FOSSIL FUEL ENDOWMENTS FOSSIL FUEL ENERGY FOSSIL FUEL PRICES FOSSIL FUEL USE FOSSIL FUELS FUEL CONSUMPTION FUEL PRICE FUEL PRICES FUEL PRODUCERS FUEL PUMP FUEL SUBSIDIES FUEL TAX FUEL TAX RATES FUEL TAXATION FUEL TAXES FUEL VOLUME GAS CONSUMPTION GAS PRICES GASOLINE GASOLINE CONSUMPTION GASOLINE PRICES GDP GDP PER CAPITA GLOBAL CLIMATE GLOBAL CLIMATE CHANGE GOVERNANCE INDICATORS GOVERNMENT BUDGET GOVERNMENT EXPENDITURES GRID CONNECTIONS GROSS DOMESTIC PRODUCT GROSS DOMESTIC PRODUCT PER CAPITA INCOME INCOME GROUP INCOME GROUPS INCOME LEVELS KEROSENE KEROSENE SUBSIDIES LESS DEVELOPED COUNTRIES LOW-INCOME COUNTRIES MARKET PRICE MIDDLE INCOME COUNTRIES MIDDLE-INCOME COUNTRIES MONOPOLIES MOTOR FUEL MOTOR FUELS MOTOR VEHICLE MOTOR VEHICLE TRAFFIC MOTOR VEHICLE USE MOTOR VEHICLES NATURAL GAS NEGATIVE EXTERNALITIES NET OIL OIL EXPORTER OIL EXPORTERS OIL IMPORTING COUNTRIES OIL OUTPUT OIL PRICES OIL SUPPLY OPPORTUNITY COSTS PASSENGER CARS POLITICAL BUSINESS CYCLE POLITICAL DETERMINANTS POLITICAL ECONOMY POLITICAL POWER POLITICAL REGIME POLITICAL STABILITY POLITICAL SYSTEM POLLUTION POLLUTION LEVELS POSITIVE EFFECTS POVERTY ALLEVIATION POWER POWER DISTRIBUTION POWER PARITY PRICE CHANGES PRICE DISTORTIONS PRICE INCREASES PRICE LEVELS PRIVATE TRANSPORT PROPORTIONAL REPRESENTATION PUBLIC FINANCES PUBLIC GOOD PURCHASING POWER REGIME CHANGE REGULAR GASOLINE RESTRICTIONS ROAD ROAD TRAFFIC ROAD TRANSPORT ROADS SAFETY TAX TAX REVENUE TAX REVENUES TRANSPORTATION TRAVEL DISTANCES TRUE UTILITIES VEHICLES VOTERS WEALTH WORLD MARKET van Beers, Cees Strand, Jon Political Determinants of Fossil Fuel Pricing
relation	Policy Research Working Paper;No. 6470
description	This paper provides an empirical analysis of economic and political determinants of gasoline and diesel prices for about 200 countries over the period 1991-2010. A range of both political and economic variables are found to systematically influence fuel prices, and in ways that differ systematically with countries per-capita income levels. For democracies, the analysis finds that fuel prices correlate positively with both duration of democracy and tenure of democratic leaders. In non-democratic societies there is more often no such relationship or it is the opposite of that for democracies. Regime switches -- transitions from non-democratic to democratic government, or vice versa -- reduce fuel prices. Fuel prices are also lower for more corrupt, or more centralized, governments. Higher levels of gross domestic product per capita lead to higher fuel prices, while export income from selling fossil fuels reduces these prices dramatically. Higher motor fuel consumption also appears to reduce fuel prices, most for gasoline. Absolute "pass-through" of crude oil price changes to fuel prices is found to be high on average.
format	Publications & Research :: Policy Research Working Paper
author	van Beers, Cees Strand, Jon
author_facet	van Beers, Cees Strand, Jon
author_sort	van Beers, Cees
title	Political Determinants of Fossil Fuel Pricing
title_short	Political Determinants of Fossil Fuel Pricing
title_full	Political Determinants of Fossil Fuel Pricing
title_fullStr	Political Determinants of Fossil Fuel Pricing
title_full_unstemmed	Political Determinants of Fossil Fuel Pricing
title_sort	political determinants of fossil fuel pricing
publisher	World Bank, Washington, DC
publishDate	2013
url	http://documents.worldbank.org/curated/en/2013/05/17784262/political-determinants-fossil-fuel-pricing http://hdl.handle.net/10986/15569
_version_	1764429570536112128

Political Determinants of Fossil Fuel Pricing

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